Reuters blog archive
The week kicks off with a G8 leaders’ summit in Northern Ireland. Syria will dominate the gathering and the British agenda on tax avoidance is likely to be long on rhetoric, short on binding specifics.
But for the economics file, this meeting could still yield big news. For a start, Japanese prime minister Abe is there – the man who has launched one of the most aggressive stimulus drives in history yet has already seen the yen climb back to the level it held before he started.
The financial backdrop could hardly be more volatile with emerging markets selling off dramatically since the Federal Reserve warned the pace of its dollar creation could be slowed.
Berlin has said the G8 leaders are likely to discuss the role of central banks and monetary policy, and Angela Merkel will hold bilateral talks with Abe during the summit. President Barack Obama travels to Berlin after the summit for talks with Merkel.
The week kicks off with a G8 leaders’ summit in Northern Ireland. Syria will dominate the gathering and the British agenda on tax avoidance is likely to be long on rhetoric, short on specifics. But for the markets, this meeting could still yield some big news. For a start, Japanese prime minister Abe is there – the man who has launched one of the most aggressive stimulus drives in history yet has already seen the yen climb back to the level it held before he started. Abe will also speak in London and Warsaw during the week.
The financial backdrop could hardly be more volatile with emerging markets selling off dramatically since the Federal Reserve warned the pace of its dollar creation could be slowed. Berlin has said the G8 leaders are likely to discuss the role of central banks and monetary policy, and Angela Merkel will hold bilateral talks with Abe during the summit. President Barack Obama travels to Berlin after the summit for talks with Merkel.
Some interesting events to ponder over the weekend, though not many of them came from the G8 summit which, as is customary, was strong on rhetoric but bare of any specific policy measures to tackle the euro zone crisis. However, markets seems to have tired of their panicky last few sessions. German Bund futures have opened lower as investors took profits rather than seizing on any positive news. European stocks have edged up.
It does appear that with the ascension of France's Francois Hollande, the G8 firmament turned into G7 (or maybe 5 since we didn’t hear much from Japan and Russia) versus 1 (Germany) but as things stand we’re still heading for a fairly anaemic “growth strategy” unless euro zone leaders coalesce behind the notion of giving Spain and Greece longer to make the cuts demanded of them. Spain has moved the goalposts further in the wrong direction, revising its 2011 deficit up to 8.9 percent from 8.5 and blaming the overspending regions. That means its already loosened target of 5.3 percent for this year is now even harder to achieve.
So we’ve got the fresh Greek elections we expected and markets, despite the inevitability that we would get here, have reacted with some alarm. European stocks have shed around 1 percent, and the harbour of German Bunds is pushing their futures price up in early trade. The Greeks will try to form a caretaker government today to see them through to elections expected on June 17.
The key question is whether the mainstream parties can mount a convincing campaign second time around, playing on the glaring contradiction in SYRIZA’s position (no to bailout, yes to the euro) and essentially turning the vote into a referendum on euro membership, which the overwhelming majority of Greeks still support. Don’t count on that. SYRIZA remains ahead in the polls.
To be able to pull it off, PASOK and New Democracy will need some help from Europe. There have already been hints from Brussels that if a pro-bailout government is formed, Athens could be given some leeway on its debt-cutting terms. But equally other voices are saying there is no more room for manoeuvre.
from Oddly Enough Blog:
Hey Blog Guy, we could use some of your famous travel advice. My brass ensemble is going to Paris, and we....
Are you out of your mind? Don't you know the French can't stand brass instruments? You could be arrested before you play a single note.
Police threaded through a growing throng of demonstrators gathering in a downtown Toronto Park on Friday to demand G20 countries do more to fight global poverty and protect woman's gender rights.
As the number of protesters grew under Canada's trademark leafy maple trees, pro bono lawyers announced their phone numbers and told protesters to write them down on their hands or arms.
G8 host Huntsville has been a picture of quiet in the run-up to the summit, which kicked off on Friday. Reporters that have come up to cover potential protests have had little luck so far uncovering anything beyond bemused residents and hundreds of bored cops.
So there was more than a little excitement Friday when not one, but two protests sprang up in the summer resort town’s center. A media stunt by Oxfam involving the group’s famous paper mache “heads” of world leaders drew a throng of reporters and camera crews to a waterfront park in the resort town’s center.
The following is a guest post by Marc Levinson, a senior fellow for international business at the Council on Foreign Relations. The opinions expressed are his own.
The world’s leaders are stuck on a summitry treadmill. Nothing better could come from this week’s summit meetings in Canada than a way for them to get off.
from Africa News blog:
Tom Cargill, Assistant Head of the Africa Programme at Chatham House, writes on the West's relationship with Africa:
French President Nicholas Sarkozy put it best this week, when he spoke of the increasing important of Africa in Global Affairs: "Africa's formidable demographics and its considerable resources make it the main reservoir for world economic growth in the decades to come."
from Financial Regulatory Forum:
PITTSBURGH (Reuters) - Group of 20 leaders on Friday designated themselves as the new forum for steering the world economy, ending the long reign of the G7 as the preeminent committee for guiding global growth:
The G20 leaders said their representatives would report back to them at the next meeting "on how to maximize the effectiveness of our cooperation", and agreed to have a G20 summit in Canada in June 2010 and in Korea in November.
Meetings thereafter will probably be held annually, and France will be the host in 2011.